Opioid Negotiation Class Creation Questioned

Opioid Negotiation Class Creation Questioned

Introduction

On Tuesday, the Sixth Circuit Judge, David McKeague, questioned the requirement of the opioid negotiation class after hearing arguments from the manufacturers and distributors who claimed that the class created by a federal judge is unconstitutional.

U.S. District Judge Dan Polster, presiding over all federal opioid lawsuits, certified the negotiation class last September with an intent to allow more than 30,000 government entities across the country to get a share of any potential settlement proceeds from national, multidistrict litigation over the opioid crisis.

The attorneys for the negotiation class will try to make a nationwide settlement with individual drug companies. The approval of any settlement will be done by polling and would require approval by 75% of voting governments by number, by population, and by the allocation of settlement funds. These thresholds will be managed separately by governments that had sued as of June 14, 2019, and those that had not.

The arguments were conducted via videoconference, where defendant Attorney Sonya Winter of the San Francisco-based firm Covington and Burling LLP claimed that the invention of the negotiation class violated Rule 23 of the Federal Rules of Civil Procedure, which governs class actions.

New York University law professor Samuel Issacharoff, representing municipalities and favoring the class action, asserted that the mechanism would allow the class members to participate directly in the settlement process and maximizes their advantage.

Judge McKeague indicated that he isn't in favor of "judicial inventiveness," stating that there are already mechanisms for litigating and settling class actions.

Earlier, Indivior Solutions Inc. a subsidiary of Indivior PLC, a Chesterfield County-based drug company, agreed to pay $600 million after citing guilty in federal court in Abingdon over its opioid addiction treatment drug Suboxone.

The company will pay the amount over seven years to federal and state authorities. It has even agreed with the Federal Trade Commission (FTC) to take necessary precautions by not engaging in similar conduct and will also establish a corporate integrity agreement with the Department of Health and Human Services' inspector general.

Last year a federal grand jury in western Virginia raised a criminal and civil liability lawsuit jointly with the U.S. Department of Justice after an investigation by the FTC, against Indivior. The investigation claimed that the company used fraudulent marketing strategies to increase profits from Suboxone Film.

The company pleaded guilty in 2012 for making false statements and was also charged with one count of health care fraud, four counts of mail fraud, and 22 counts of wire fraud, as well as other charges as mentioned in the court records. It has even paid more than $2 billion over the marketing of Suboxone including $1.4 billion during the last year with Indivior's former parent company Reckitt Benckiser Group PLC.

Currently, the company is required to make a settlement that comprises  $289 million to end the criminal charges, including fines, forfeiture, and restitution; $300 million to end civil allegations from state and federal enforcers; and $10 million to settle charges claiming that the company violated the antitrust laws. It is considered as the largest-ever resolution in a case brought by the Department of Justice involving an opioid drug.